Eric Chin, Rajesh Sreenivasan, Hanim Hamzah

The recent push to compete with multi-disciplinary firms like the Big Four has resulted in law firms planning their own forays into non-law services, and the pandemic has only accelerated that trend. However, experts feel that firms should consider their strategies carefully.



ERIC CHIN, principal, Alpha Creates

Some law firms are starting to diversify their services outside of the legal industry. There are two ways firms are thinking about non-law services: (1) Legal service generators, (2) Legal service enhancers. Legal service generators are essen-tially upstream services like business consulting, legal operations consulting, technology consulting, corporate advisory, infrastructure consulting, defence and commercial advisory and infrastructure consulting services. These are areas of work that are the tip of the spear that would generate potential flow of legal work to the law firm from services provided. Then there are also legal service enhancers like risk advisory, compliance, corporate governance, forensic and technology services, and tax consulting services that enhance the legal service provided to clients. It’s the same strategy that the Big Four accounting firms have mastered through years of building multidisciplinary practices. Ultimately, how firms execute their non-law services and cross-sell into their legal practice will be the key determinant of success. Some considerations include:

  • Reassessing the key performance indicators (KPIs) used to manage the non-law services. Firms have carved out the non-law practices as separate entities because the KPIs required to manage a legal practice is different to the KPIs required to manage non-law practices (such as billable targets, leverage ratio, use of technology and processes);
  • Developing a mechanism to encourage cross-selling through the sharing of profit from client introductions; and
  • Building a culture within the firm that encourages lawyers to think outside of their own legal domain (which is already a challenge) to work with the non-law services towards a coordinated client approach

RAJESH SREENIVASAN, head of TMT, Rajah & Tann Singapore

Law firms seeking non-law services (such as legal technology service lines) to augment their core areas of expertise should always think of the types of synergy and value that the non-law service can bring to the firm and its clients. A law firm specialising in corporate matters may find little value in investing in e-discovery and digital forensics solutions. The trick is to find the right fit that would create the right synergy. For example, a firm that has a strong dispute resolution arm may well wish to invest in e-discovery solutions, so that it can both handle a larger volume of complex disputes, while achieving higher cost-efficiency for clients. Another example would be a firm that is seeking to deepen its investigations practice — a forensics arm would appear to be a right fit. At the same time, I would urge all lawyers and law firms to bear in mind that the adoption of legaltech is not an arms-race. Don’t jump on the bandwagon just because everyone else appears to be doing so – remember always that law firms do not all have a static homogenous workflow and so your specific legaltech journey should augment the nature of your practice. I would urge lawyers to think through their needs, do their homework (learn about the solutions on the market), weigh their options, understand the limitations of new technologies (for example, artificial intelligence is far from perfect today), consider their trade-offs in terms of time, cost and effort to adopt new technologies, so that they can ultimately choose the right technology that will help them augment and amplify their existing legal work-flow today and into the future, and bring greater efficiency and value to their firms and their clients.

HANIM HAMZAH, regional managing partner, ZICO Law Network

At ZICO, we unbundled some of our non-core legal services and put these in different subsidiaries in order to list ZICO Holdings a couple of years ago. The driver behind that was really to remain competitive, to be able to continue to provide value to our clients. We realised there were non-core legal services, very closely related to legal, which would perform better under different umbrellas, rather than under the law firm because we wanted to focus the law firm on providing high-value strategic legal advice. And with the changing competitive landscape of the legal industry there is a need to also change the way we do business. The client has changed as well; the in-house budget has changed, not all of their legal spending is allocated to law firms. They have different providers and different solutions for their legal needs, driven mainly by price. Because of this, as a law firm we had to look at our strategy and concentrate on what we do best. As a law firm, we had to provide core high-value legal services, and for the other parts — legal services that can be commoditised — that can then be done in a separate umbrella. Those companies then have different capital structure and they’re more agile, because law firms typically need a good address, and a comfortable office and meeting rooms. But for other types of services, that are not core legal, but are related, those can be done out of alternative premises and with different types of pricing structures. At the end of the day, what is important is staying close to the client and delivering solutions that best meet the needs of the client. Whichever structures used, maintaining excellent services without diluting overall brand value is key.


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